Hedge Funds Are Buying Exeter Resource Corp. (XRA)

Exeter Resource Corp. (NYSEAMEX:XRA) investors should pay attention to an increase in enthusiasm from smart money lately.

To most investors, hedge funds are perceived as worthless, outdated investment tools of the past. While there are more than 8000 funds with their doors open at the moment, we at Insider Monkey look at the upper echelon of this group, around 450 funds. It is estimated that this group has its hands on the majority of the smart money’s total capital, and by keeping an eye on their highest performing stock picks, we have formulated a few investment strategies that have historically outpaced the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 23.3 percentage points in 8 months (check out a sample of our picks).

Equally as important, positive insider trading sentiment is a second way to parse down the investments you’re interested in. There are a variety of incentives for a corporate insider to drop shares of his or her company, but only one, very clear reason why they would buy. Many empirical studies have demonstrated the market-beating potential of this strategy if you know what to do (learn more here).

With all of this in mind, it’s important to take a glance at the latest action surrounding Exeter Resource Corp. (NYSEAMEX:XRA).

Hedge fund activity in Exeter Resource Corp. (NYSEAMEX:XRA)

At Q1’s end, a total of 6 of the hedge funds we track were bullish in this stock, a change of 20% from the first quarter. With hedgies’ capital changing hands, there exists a select group of key hedge fund managers who were increasing their holdings substantially.

#N/A

Consequently, specific money managers were breaking ground themselves. Royce & Associates, managed by Chuck Royce, assembled the biggest position in Exeter Resource Corp. (NYSEAMEX:XRA). Royce & Associates had 0.6 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also made a $0 million investment in the stock during the quarter.

How have insiders been trading Exeter Resource Corp. (NYSEAMEX:XRA)?

Insider purchases made by high-level executives is at its handiest when the company we’re looking at has seen transactions within the past six months. Over the latest 180-day time period, Exeter Resource Corp. (NYSEAMEX:XRA) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Exeter Resource Corp. (NYSEAMEX:XRA). These stocks are Claude Resources Inc. (USA) (NYSEAMEX:CGR), Kingold Jewelry Inc. (NASDAQ:KGJI), Gold Standard Ventures Corp (NYSEAMEX:GSV), Comstock Mining, Inc. (NYSEAMEX:LODE), and Richmont Mines Inc. (USA) (NYSEAMEX:RIC). This group of stocks are the members of the gold industry and their market caps match XRA’s market cap.

With the results exhibited by the aforementioned strategies, retail investors must always pay attention to hedge fund and insider trading activity, and Exeter Resource Corp. (NYSEAMEX:XRA) is an important part of this process.

Click here to learn why you should track hedge funds